Metal Bulletin’s price quotation for domestic spot ferro-chrome also dropped to 6,900-7,100 yuan per tonne, in warehouse China, down 20% compared with the previous week.

The new contract and spot ferro-chrome price ranges are equivalent to about 77-80 cents per lb.

Most market participants said they anticipated further price drops on both ore and alloy, citing high raw material inventories and poor demand from the stainless steel sector.

“It will be hard to say UG2 prices have touched the floor before inventories wind down. And the downward ferro-chrome trend will be also weighing on chrome ore prices,” a major ore trader told Metal Bulletin.

A gap persists between Chinese domestic ferro-chrome prices and imported ferro-chrome prices, leading to a stand-off between international ferro-chrome suppliers and their customers in China.

While ferro-chrome suppliers outside China have said in recent weeks that they are under less pressure to cut their Chinese than Chinese domestic mills are, import prices are edging lower.

“I’m holding off buying in the spot ferro-chrome market and see what the impact will be from the markets in China,” a consumer in Europe told Metal Bulletin.

Spot enquiries have been for small volumes as most consumers remained covered on long-term contracts, according to a supplier source who added that the ferro-chrome market is better balanced in Europe than in China.

“The main consumers are covered for the time being and the transactions are rather limited to small lots,” the source told Metal Bulletin.